Global investment in human resources technology is defying broader economic slowdowns, surging to new highs in the first half of 2025 as employers continue to modernize their workforce systems.
According to George LaRocque, founder and chief analyst at WorkTech, a New York–based market intelligence and HR technology advisory firm, funding in HR tech accelerated sharply this year — signaling renewed investor confidence in digital workplace transformation.
Speaking at HR Tech 2025 in Las Vegas, LaRocque revealed that $3.55 billion was invested across 119 deals in the first half of the year.
“This surprises people, because it didn’t feel like that was happening this year,” LaRocque said.
The first six months of 2025 outpaced the same period in 2024 by 60%, and the second half of last year by 10%. LaRocque added that 11 mega-deals — each exceeding $100 million — helped push total investment levels to those not seen since the “gravy train years” of 2018–2019.
However, the resurgence was uneven across categories. Investors showed strong interest in human capital management (HCM) suites, payroll, and benefits platforms, while talent acquisition (TA) and learning technologies lagged behind due to hiring slowdowns and market caution.
“TA tech investment is falling victim to the economy and job market headlines,” LaRocque said. “Meanwhile, HCM, payroll, and core HR categories continue to carry the HR tech market.”
Macro Trends and Market Outlook
Despite signs of macroeconomic stability, perceptions of growth remain mixed.
“Things feel different to different people depending on where they sit,” LaRocque noted. “At a high level, the global economy looks fairly healthy — with 3% GDP growth projected for 2025 and roughly 78 million net new jobs expected by 2030. But for many, it doesn’t feel that way.”
He added that the most significant employment gains are expected in front-line, care-economy, education, and technology roles, even as some knowledge-worker positions face displacement due to automation and AI integration.
As organizations continue to balance efficiency, experience, and inclusion, experts say HR technology investment will remain a critical lever for navigating the evolving world of work.
About the Author
